Fri, Feb 13, 2015

WICHITA, Kan. (AP) — A Mexican cartel is suspected of laundering $2 million in drug proceeds through a small southwest Kansas bank to avoid tighter restrictions on U.S. currency in its home country, according a U.S. Drug Enforcement Administration affidavit obtained by The Associated Press.

The affidavit outlined an investigation by the DEA into drug trafficking and money laundering activities between the two countries by the Juarez Cartel/La Linea, sometimes referred to as Mexican Mennonites. The DEA affidavit, filed in U.S. District Court in Kansas, supports a search warrant that was executed against a former bank official.

The DEA investigated a Kansas couple believed to be working for the cartel who made 32 deposits at the Plains State Bank in Plains, Kansas, starting in early 2011, according to the affidavit. The deposits ended in May 2014, when the U.S. Customs and Border Protection seized about $170,000 from them as they entered the United States from Mexico — the third time border agents had seized bulk U.S. currency, totaling $850,000 in all, from the couple.

The executed warrant was filed Tuesday. The case was later sealed after the AP obtained the document and contacted federal prosecutors for comment. No charges have been filed.

Lindsey Schartz, senior vice president at Plains State Bank, said the two bank officials involved no longer work there. She referred any further comment to the U.S. attorney's office.

"It is an ongoing investigation — that is all we can say," U.S. Attorney Barry Grissom said Wednesday.

In an attempt to combat money laundering, Mexican banking regulations restrict how much U.S. currency can be deposited into Mexican financial institutions. The DEA affidavit alleges that to counter that, the Mexican Mennonites employed people to launder drug proceeds in the United States.

The DEA said it had specifically identified Mexican Mennonites who brought large amounts of U.S. currency from Mexico into Kansas, where the money was deposited into U.S. bank accounts. The money was then wired back to Mexico or was used to buy items that were sent to that country.

Plains, a rural hamlet of fewer than 1,150 people, is in southwest Kansas, a region where meatpacking plants have drawn large immigrant populations.

The former Plains bank officials admitted that they knew that the couple, who live in Meade, Kansas, brought large amounts of U.S. currency from Mexico and failed to obtain required information and documentation, the affidavit says.

The bank official who handled the couple's accounts kept records on yellow legal pads, which have since disappeared, the affidavit says. It also alleges the official was seen carrying boxes out of the bank on a Sunday in late January.

The warrant sought any bank documents, but a search of his home last week found none, according to the executed warrant filed with the court.

The affidavit said the DEA has no direct evidence or admission that the bank official knew the money was coming from a drug cartel. But the affidavit says the official should have realized that transporting large amounts of currency from Mexico is "highly irregular and suspicious" and "indicative of drug trafficking and money laundering with drug proceeds."